Russia-Ukraine Crisis Will Put Economic Strain On Kyrgyzstan, And China Could Benefit
According to RFE/RL, The Western sanctions applied against Russia in an effort to prevent an invasion of neighbouring Ukraine will have a trickle-down effect on many smaller countries with close economic ties to Moscow, experts say.
One of those countries is Kyrgyzstan.
With the United States, European Union states, and many other Western countries announcing sanctions on February 21-23 against Russia for its recognition of separatist entities in Ukraine, those effects are already being felt.
Even before the recognition announcement by the Kremlin, the international financial rating agency Moody's put Kyrgyzstan -- along with Belarus, Tajikistan, Moldova, and Armenia -- on a list of countries most likely to be affected by sanctions on Russia, the U.S. business magazine Forbes reported.
"If sanctions are imposed, they will affect the [Commonwealth of Independent States] countries, which have close economic, financial, and energy ties with Russia through various channels. It will also have a negative impact on their external positions," Moody's said in a study.
ParvizMullojanov, a researcher at Sweden's Uppsala University, told RFE/RL that if the Russian ruble devalues significantly, "the currencies in the countries in [Central Asia] will also depreciate."
One of the first economic measures in Kyrgyzstan that would be hit due to sanctions against Moscow are the many millions of dollars in remittances from the estimated 1 million Kyrgyz migrant workers in Russia.
According to the National Bank of Kyrgyzstan, more than $2.77 billion was transferred to the country from abroad by migrants in 2021.
Beyond the sanctions, there is concern that a massive military attack by the estimated 190,000 Russian forces amassed in and near Ukraine would also directly hurt the Kyrgyz economy.
Kyrgyz politician Ravshan Jeenbekov told RFE/RL that an armed conflict between Russia and Ukraine would have severe economic consequences for Kyrgyzstan, which is a member of the Russia-led Eurasian Economic Union with Armenia, Belarus, and Kazakhstan.
"First of all, oil and gas prices will rise," he said. "We all know that Russia is very important in [the energy] market. Secondly, Russia is one of the largest exporters of wheat in the world."
Jeenbekov cited other economic issues likely to affect Kyrgyzstan.
"Because international financial institutions are likely to sever or cut back their business with Russia, the country's economic and financial situation is likely to worsen. It will inevitably affect the lives of our migrants [and result in fewer jobs and therefore less in remittances]," he said.
A disruptive military conflict between Russia and Ukraine could also affect Kyrgyzstan's economic ties with Ukraine, which has an annual trade turnover of some $100 million with Kyrgyzstan.
